The Commodity Futures Trading Commission said it will hold hearings next month to examine oversight of trading, as senators have criticised the policing of US energy markets and suggested merging the patchwork of regulation.

The September 18 hearing will examine the oversight of trading on regulated futures exchanges and exempt commercial markets.

In June, the Senate has released a report, Excessive Speculation in the Natural Gas Market, examining how trading by collapsed hedge fund Amaranth Advisors led to high prices in the US natural gas market and criticised the regulatory regime.

Senator Carl Levin, chairman of the permanent subcommittee on investigations, said: “Current commodity laws are riddled with exemptions, exclusions and limitations that make it virtually impossible for regulators to police US energy markets, particularly the loophole which means regulators can apply excessive speculation limits to regulated markets like Nymex, but not unregulated markets like ICE.”

Amaranth traded natural gas contracts on both the New York Mercantile Exchange and ICE, the two main US energy markets. Nymex is fully regulated by the Commodity Futures Trading Commission, but ICE is exempt from regulation as a commercial market.

The committee recommended Congress should eliminate this loophole and the CFTC should monitor aggregate positions on Nymex and ICE.

Last month, the securities, insurance and investment subcommittee of the committee on banking, housing, and urban affairs securities, said it had asked for a study on whether the SEC and the CFTC should merge some of their oversight functions.

The CFTC regulates trading in commodity futures and options, while the SEC oversees the key participants in the securities world, including securities exchanges, securities brokers and dealers, investment advisors and mutual funds.